The D.C. Council cleared the way for the Randall School to change hands yet again, this time from the Corcoran Gallery of Art to a joint venture that would build housing, a hotel and a gallery on the long-neglected property.

The $6.5 million purchase agreement, struck between the Corcoran and a team consisting of D.C. development company Telesis Corp. and Miami-based CACB Holdings LLC, still needed the District’s blessing on Sept. 21 — four years after the city had sold the land.

The council’s unanimous support that day is a “good first step” to advance a long-stalled development project in a neighborhood with great promise, said Telesis President Marilyn Melkonian.

The Randall School, at 65 Eye St. SW, was last used as a school in 1978. It served briefly as a makeshift homeless shelter, but neighbors have craved a productive use of the building between Arena Stage and Nationals Park, three blocks from the Capitol.

The new plans for Randall include pri­vate residences, a hotel, retail and a 25,000-square-foot contemporary museum designed by Arena Stage planner Bing Thom Architects.

Residents thought the city’s $6.2 million deal in 2006 with the Corcoran, which promised an art school and nine-story residential building, was the answer. But the deal crumbled in 2008 after developer Monument Realty LLC lost its equity partner to bankruptcy.

That paved the way for Telesis and CACB Holdings, owned by the Miami-based Rubell family, noted art collectors and hotel owners whose properties include the Capitol Skyline on the opposite side of Eye Street.

To satisfy the revised plans, the council had to change certain covenants of the original deal to replace an arts educational use with an arts exhibition use.

Under the amended covenants and community benefits package, the Telesis/CACB venture agreed to abide by local hiring mandates, meet a 5 percent first-source employment goal for neighborhood residents, landscape the next-door Eye Street Park, provide space for neighborhood town meetings and host an annual on-street arts festival.

The District has the option to reacquire the property if the first phase of construction has not started by Aug. 21, 2018.

Construction is still two years away as the Telesis/Rubell venture will need a modification to the Randall School’s existing planned unit development approval, Melkonian said.

Several council members wondered aloud whether the District would be on the hook if Telesis and the Rubells failed to follow through. Council Chairman Vincent Gray, the District’s presumptive next mayor, sought assurances that this latest joint venture couldn’t simply flip the property for a windfall profit.

When Councilman Jim Graham, D-Ward 1, questioned Kwame Brown, D-At large, Economic Development Committee chairman and council chairman-to-be, on D.C.’s obligations if the new deal fell apart, Brown responded: “We have an option. If you have $6.2 million, we can buy the school back. And we can have it, and it’ll just be an eyesore to the community, which I believe the whole Southwest community has no interest in.”

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